Lesson from the Salon

I have often spoken about the parallels between software implementation consultants and salon owners. For example, both revenue models have about 50 percent coming from the sale of product (including renewals for software) and about 50 percent coming from service provided.

This morning, this “Suggested post” was in my Facebook stream:

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Notice that it mentions that Julie is salon owner, but what is to stop individual stylists from creating their own App. This way if they leave the salon of their current employ, their clientele can easily track them down and bypass what I understand from my wife and other female colleagues as “the hunt” that takes place when this occurs now.

Of course, the jump to software implementation consulting is easy to see. Individual consultants can set up Apps and away they go.

This enforces the great idea from Peter Drucker that, “In a knowledge society, the most probable assumption for an organization to make is that they need the knowledge workers far more than the knowledge workers need them.”

What are you doing to make you organization a place where knowledge worker thrive and get their knowledge dividend?

A Response to The End of Capitalism

In a Facebook forum that I frequent, one of the members posted this article by Klaus Schwab in the Huffington Post entitled The End of Capitalism – So What is Next?

Here is my response to both the post and the article itself.

If by capitalism he means the system we have in place today. I agree. However, the term for what we have today is not "capitalism" is the true sense. It is "cronyism" or what I call "handicapitalism."

Most truly understood we have a system where the elites in big government and big business have combined to control the resources of production. Including, BTW, the currency itself.

The most accurate term from an economic standpoint is fascism. (Note not NAZISM.) Fascism, from an economic perspective is control of the resources, but not means of production. This latter state is called communism.

Please note I am not a Republican or a Democrat and I am not calling Bush or Obama fascists. I am saying the the policies of the US government have become increasingly fascistic over the year no matter who has been in the White House.

Now that said, what Mr. Schwab is describing as the replacement of this so-called “capitalism” is really just the market responding to the idea of knowledge workers. He calls this idea “talentism,” but is really nothing more than a meritocracy based on knowledge.

On Words I Would NOT Use

At a recent Firm of the Future Symposium with the THRIVEal Network in Greenville, SC, Ron Baker and I were asked about some of our word preferences. On the spur of the moment we developed this quick list of words we believe should be avoided by professional knowledge firms.

Staff – This makes us think of a type of infection. We prefer team member, colleague, associate, or people as alternatives.

Client – In ancient Rome, the lawyers of the day functioned as public servants and were not paid for their work. Instead, they were appointed to their duties in working with their clients. The relationship was not one of equal status and implied a sense of duty and obligation to serve the great unwashed. The word still has this connotation in the context of social workers and their clients. We prefer the term customer which is an Anglo-Saxon word derived from the fact that it was the custom of certain people to frequent a particular place of business.

Value billing – Nothing will set a VeraSagi (our made up and officially adopted name for someone from VeraSage) off into a tirade faster than calling the pricing practices we espouse value billing. A bill is produced in arrears whereas a price is agreed to upfront. This term is linked with professionals when the do write-ups to a time calculated bill. We believe this practice to be more akin to mail fraud. The preferred terms are value pricing, pricing on purpose, or pricing with purpose. When discussing price with a customer we suggest the term fixed price or open (meaning transparent) price.

Fee – This word has a negative connotation as it is associated with governmental and penalty type incursions. We suggest the use of the more neutral word price.

Hours – We believe the only place time spent should matter is in prison. We would ban all use of the word hour and suggest a $5 fine whenever it is used. There is no acceptable substitute.

Training – Horses and dogs are trained, humans are educated. Training implies a bullwhip lashing sounds in the background. Also, do you want your 16-year-old daughter to get sex training or sex education.

Service – We believe most professional firms do not provide services. They provide access to and/or transfer of knowledge, results, objectives, and occasionally goals.

Did we miss any of you favorites? If so, please leave a comment with the term to be avoided and your suggested alternatives.

ET HORA LIBELLUM DELENDA EST

Sesame Street for Knowledge Workers

Last Sunday, my wife and I brought my son, Sean, and daughter, Cara, to the Imagination Movers concert at the Verizon Center just outside Dallas. To coin a phrase, a good time was had by all.

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For those of you not familiar with the “Movers” (as we in the hip-in-the-know-‘cause-we-have-a-five-year-old crowd like to them) let me give you some quick background. The Imagination Movers are a kid-focused rock band that began when a group of four friends in New Orleans discovered they shared a similar distain for music groups oriented for children. (With this I agree with them. Barney, Teletubbies and especially The Wiggles are downright creepy.)

They achieved significant regional success, selling over 100,000 copies of their independently produced CDs. In 2006, they inked a deal with Disney and for the past three years have been one of the top-rated shows on the Disney Channel.

Aside from being a pretty darn good writers and performers, the messages they convey in their music and on their show is spot on for their audience of future knowledge workers.

Each show centers around a different customer (yes, they call them customers not clients) coming into their Idea Warehouse with a problem that needs solving. The four Movers than ask some diagnostic questions (notice they do not jump to a solution!) until they decide that they do, in fact, have an Idea Emergency (I love this term). This phrase always trips an alarm and begins the song called Brainstorming which is sung in every show.

Because there are “no bad ideas when you’re brainstorming,” the Movers always end up solving the problem for their customer. Now the exchange of money is never talked about, but a few of the shows have focused around the guys solving some of their own problems, including one episode in which they record a TV commercial to attract more customers. In another episode, Bad Hair Day (one of my son’s, OK, one of my favorites), they need to help Mover Scott get his hair under control so they can take a picture for the newspaper.

In the first season, there was a neighbor called Knit-Knots who always wore beige, played only one note on his tuba (b-flat because, “the b stood for boring and the flat made it extra boring”), and did nothing in his office but “staple, stamp and stack” papers. While I rather enjoyed this slam at the monotony of the office service worker, it was clear that after season one, the gag had played itself out and Knit-Knots is not in season two or three.

Knit-Knots’ niece, Nina, however, has continued on the show in part to bring some female presence, but mostly because the actress that plays Nina, Wendy Calio is quite a talent herself.  The live concert featured her in a cover of The Black-Eyed Peas’ I’ve Got a Feeling. Dare I say, she has a much better voice than Fergie.

 

I strongly recommend the Imagination Movers to any of you with children or grandchildren. Heck, maybe it should be required viewing for all current knowledge workers.

What I Believe Redux

Two weeks ago, in a post entitled, What I Believe, I put forward a declaration. It went thusly:

I believe in challenging the status quo. The way I challenge the status quo is helping professionals change their business model from a focus on service to a focus on knowledge. It happens to be a better model. Are you interested in changing?

In the fortnight since that post, I have been tweaking it in my mind and I am please to put forward this updated declaration.

I believe that small business is where the vast majority of the wealth of the world is created. I help small professional businesses recognize that they do this through developing and sharing their knowledge. It is a great model. Do you want to know more?

I am curious as to what your thoughts are about this. Did any of you make a declaration? If so, are you willing to share it below? What are your thoughts on my declarations? Do you think the second is an improvement?

What I Believe

I have been wanting to write this post for over a week.

While the video below is nothing new, it does a great job of explaining and relating concepts I have known to be true.

 

It has inspired me to make this declaration.

I believe in challenging the status quo. The way I challenge the status quo is helping professionals change their business model from a focus on service to a focus on knowledge. It happens to be a better model. Are you interested in changing?

Please feel free to make your declaration below in the comments.

Reed Holden on IT Services Price Wars

In pricing guru Reed Holden’s latest newsletter and blog post, he drives home the point that while IT buyers tend to look like are buying on price they really are not. They just use low price providers to drive down the prices of others.

The way to call them on this is to offer options, including a bare bones option. Once the prospect reject the idea of the lowest price, they are no longer a price buyer. We need to call them on this.

Also, IT providers need to lead with a strategy of distinguishing themselves as knowledge firms, not service firms. This means positioning themselves more like insurance companies do. With insurance (healthcare excepted, but do not get me started), we pay for things we do not want. With IT, we do not want problems.

Right idea, wrong thinking!

Yesterday, I received a solicitation regarding a “solution for transferring knowledge!” It included a link to the following video.

 

Problems with this:

  1. Bad name – Knowledge Harvest. It sounds like you are using a sickle or combine and lopping peoples heads off.
  2. Defeatist attitude. – It implies that there is no way to keep this people around, so you should just exploit them while you can.
  3. Victim mentality. – “It is not your fault we are leaving, it is just the way we are.” Again, there is nothing you can do.

Now, I did view their product page and the system itself seems like it would be helpful to collect and disseminate tactic knowledge throughout an organization. This is, in fact, something sorely needed in professional knowledge firms. However, I would suggest to them:

  1. That they change the name.
  2. That they emphasize the value of disseminating the knowledge throughout the organization. It will increase the overall value of the firm by increase the knowledge of the individuals because the knowledge will be shared rather than hoarded.
  3. That having this solution might even make the firm a better place to work because you can gain knowledge far more quickly than at other companies.

If any of you pursue looking at this further, please let me know what you think about it.